Competitive markets and The Rule of Three

The “Big Three” no longer have the automobile market to themselves, but almost every market, including the one for cars, is ruled by three dominant firms. That reality does not prevent other firms from being successful. However, all firms, regardless of their market share, must still understand The Rule of Three and how it will affect their strategy and attempt to operate efficiently.

Why Good Companies Fail

It’s not just weak organisations that spiral into decline and fail. Managerial arrogance and inflexibility can bring even great companies to their knees.

The ‘Rule of Three’ in Europe

Jagdish Sheth and Rajendra Sisodia say their research demonstrates that in mature, competitive markets there is only space for three large volume-driven companies alongside several niche specialists.

Key messages:
– Efficient markets eventually get organised into two kinds of competitors: full-line generalists and product/market specialists.

– Generalists are large scale companies, which compete across a range of products and markets, and are volume-driven. Specialists operate … [ Read more ]